The brokerage values the stock at 25 times FY28 estimated earnings per share (EPS) of Rs 100, citing a robust business model, strong order visibility, and a high-margin profile as key factors for its bullish stance.
Here are 3 reasons why the brokerage firm is bullish on the stock:
Maritime sector tailwinds & KMEW’s strategic positioning
According to Nuvama, India’s maritime sector is at a significant turning point, with unprecedented emphasis on infrastructure and inland waterway development. The brokerage highlights KMEW’s ~50% order-win rate, high entry barriers in the dredging industry, and a diversified order book that spans dredging, shipbuilding, and ancillary services—contributing 43%, 11%, and 46%, respectively.
The company’s EBITDA margin of 35–40% is described as superior, backed by a lifecycle presence in port and waterway infrastructure projects.
Robust order book and profitability outlook
As of November 2025, the order book stood at Rs 17.5 billion—equivalent to 8.7 times its FY25 estimated revenue, nearly doubling year-on-year, with orders from key government entities such as IWAI, DCI, and ~Rs 6.5 billion worth of green tug orders under the Green Tug Transition Programme (GTTP).
For FY25–FY28, Nuvama estimates revenue/EBITDA/PAT CAGR at 58%, 62%, and 71%, respectively, with order inflow and order book CAGR pegged at 42%. The firm sees KMEW trading at an attractive valuation and expects profitability to rise significantly under the Tonnage Tax Scheme, projecting FY28 PAT margin at over 30%.
Execution strength beyond India
Nuvama also points out the company’s execution capabilities across geographies like Myanmar and Bahrain (currently on hold), and highlights its capital and maintenance dredging, in-house construction, and diversified fleet as factors aiding long-term order visibility. The company has recently won 2 out of 6 tenders under GTTP, with ten more tenders expected by 2027.
Key risks
The brokerage calls out risks related to new ventures, policy or weather dependence, international exposure, and potential delays in execution or order inflows. Nevertheless, it remains confident in the company’s ability to deliver consistent performance over the forecast period.
Knowledge Marine & Engineering Works shareholding
The promoter and the promoter group of the company hold a 60.7% stake in the company, while the remaining 39.3% rests in the hands of public shareholders such as mutual funds, FIIs, and individual shareholders.
Among the individual shareholders, ace investor Ashish Kacholia also holds a significant 3,00,000 shares of Knowledge Marine & Engineering Works, equivalent to a 2.78% stake in the company, according to the latest data available on the BSE.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times.)